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Rate-Jacking: Risk-Based and Opportunistic Pricing in Credit Cards

30 Pages Posted: 20 Nov 2011 Last revised: 25 Apr 2012

Adam J. Levitin

Georgetown University Law Center

Date Written: 2011


This Article, part of a theme-volume on the Credit C.A.R.D. Act, explores the phenomenon of credit card “rate-jacking” — the practice of card issuers suddenly raising the interest rate on an account, often applying the new rate retroactively to existing balances. This Article examines the degree to which rate-jacking — now largely prohibited by the Credit C.A.R.D. Act — and credit card pricing generally reflects risk-based or opportunistic pricing.

Keywords: credit cards, Credit CARD Act, risk-based pricing, opportunistic pricing, shrouded pricing, double-cycle billing, residual interest, float, securitization, static pool, revolver, transactor

JEL Classification: K00, K12, K23

Suggested Citation

Levitin, Adam J., Rate-Jacking: Risk-Based and Opportunistic Pricing in Credit Cards (2011). Utah Law Review, No. 2, p. 339, 2011; Georgetown Law and Economics Research Paper No. 11-28; Georgetown Public Law Research Paper No. 11-136. Available at SSRN:

Adam Levitin (Contact Author)

Georgetown University Law Center ( email )

600 New Jersey Avenue, NW
Washington, DC 20001
United States

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